Finance Act 2001

ITEM NO. (1) Supplies for qualifying use of— (a) coal, coke or other solid substances held out for sale solely as fuel; (b) coal gas, water gas, producer gases or similar gases; (c) petroleum gases, or other gaseous hydrocarbons, whether in a gaseous or liquid state; (d) fuel oil, gas oil or kerosene; or (e) electricity, heat or air-conditioning. NOTES: (1) (1) Item 1(a) shall be deemed to include combustible materials put up for sale for kindling fires but shall not include matches. (2) Item 1(b) and (c) shall not include any road fuel gas (within the meaning of the Hydrocarbon Oil Duties Act 1979 (c. 5)) on which a duty of excise has been charged or is chargeable. (3) Item 1(d) shall not include hydrocarbon oil on which a duty of excise has been or is to be charged without relief from, or rebate of, such duty by virtue of the provisions of the Hydrocarbon Oil Duties Act 1979. (2) (1) In this Group “fuel oil” means heavy oil which contains in solution an amount of asphaltenes of not less than 0.5 per cent. or which contains less than 0.5 per cent. but not less than 0.1 per cent. of asphaltenes and has a closed flash point not exceeding 150°C. (2) In this Group “gas oil” means heavy oil of which not more than 50 per cent. by volume distils at a temperature not exceeding 240°C and of which more than 50 per cent. by volume distils at a temperature not exceeding 340°C. (3) In this Group “kerosene” means heavy oil of which more than 50 per cent. by volume distils at a temperature not exceeding 240°C. (4) In this paragraph “heavy oil” has the same meaning as in the Hydrocarbon Oil Duties Act 1979. (3) In this Group “qualifying use” means— (a) domestic use; or (b) use by a charity otherwise than in the course or furtherance of a business. (4) For the purposes of this Group, where there is a supply of goods partly for qualifying use and partly not— (a) if at least 60 per cent. of the goods are supplied for qualifying use, the whole supply shall be treated as a supply for qualifying use; and (b) in any other case, an apportionment shall be made to determine the extent to which the supply is a supply for qualifying use. (5) For the purposes of this Group the following supplies are always for domestic use— (a) a supply of not more than one tonne of coal or coke held out for sale as domestic fuel; (b) a supply of wood, peat or charcoal not intended for sale by the recipient; (c) a supply to a person at any premises of piped gas (that is, gas within item 1(b), or petroleum gas in a gaseous state, provided through pipes) where the gas (together with any other piped gas provided to him at the premises by the same supplier) was not provided at a rate exceeding 150 therms a month or, if the supplier charges for the gas by reference to the number of kilowatt hours supplied, 4397 kilowatt hours a month; (d) a supply of petroleum gas in a liquid state where the gas is supplied in cylinders the net weight of each of which is less than 50 kilogrammes and either the number of cylinders supplied is 20 or fewer or the gas is not intended for sale by the recipient; (e) a supply of petroleum gas in a liquid state, otherwise than in cylinders, to a person at any premises at which he is not able to store more than two tonnes of such gas; (f) a supply of not more than 2,300 litres of fuel oil, gas oil or kerosene; (g) a supply of electricity to a person at any premises where the electricity (together with any other electricity provided to him at the premises by the same supplier) was not provided at a rate exceeding 1000 kilowatt hours a month. (6) For the purposes of this Group supplies not within paragraph 5 are for domestic use if and only if the goods supplied are for use in— (a) a building, or part of a building, that consists of a dwelling or number of dwellings; (b) a building, or part of a building, used for a relevant residential purpose; (c) self-catering holiday accommodation; (d) a caravan; or (e) a houseboat. (7) (1) For the purposes of this Group, “use for a relevant residential purpose” means use as— (a) a home or other institution providing residential accommodation for children, (b) a home or other institution providing residential accommodation with personal care for persons in need of personal care by reason of old age, disablement, past or present dependence on alcohol or drugs or past or present mental disorder, (c) a hospice, (d) residential accommodation for students or school pupils, (e) residential accommodation for members of any of the armed forces, (f) a monastery, nunnery or similar establishment, or (g) an institution which is the sole or main residence of at least 90 per cent. of its residents, except use as a hospital, a prison or similar institution or an hotel or inn or similar establishment. (2) For the purposes of this Group “self-catering holiday accommodation” includes any accommodation advertised or held out as such. (3) In paragraph 6 “houseboat” means a boat or other floating decked structure designed or adapted for use solely as a place of permanent habitation and not having means of, or capable of being readily adapted for, self-propulsion. ITEM NO. (1) Supplies of services of installing energy-saving materials in— (a) residential accommodation, or (b) a building intended for use solely for a relevant charitable purpose. (2) Supplies of energy-saving materials by a person who installs those materials in— (a) residential accommodation, or (b) a building intended for use solely for a relevant charitable purpose. NOTES: (1) For the purposes of this Group “energy-saving materials” means any of the following— (a) insulation for walls, floors, ceilings, roofs or lofts or for water tanks, pipes or other plumbing fittings; (b) draught stripping for windows and doors; (c) central heating system controls (including thermostatic radiator valves); (d) hot water system controls; (e) solar panels; (f) wind turbines; (g) water turbines. (2) (1) For the purposes of this Group “residential accommodation” means— (a) a building, or part of a building, that consists of a dwelling or a number of dwellings; (b) a building, or part of a building, used for a relevant residential purpose; (c) a caravan used as a place of permanent habitation; or (d) a houseboat. (2) For the purposes of this Group “use for a relevant residential purpose” has the same meaning as it has for the purposes of Group 1 (see paragraph 7(1) of the Notes to that Group). (3) In sub-paragraph (1)(d) “houseboat” has the meaning given by paragraph 7(3) of the Notes to Group 1. (3) For the purposes of this Group “use for a relevant charitable purpose” means use by a charity in either or both of the following ways, namely— (a) otherwise than in the course or furtherance of a business; (b) as a village hall or similarly in providing social or recreational facilities for a local community. ITEM NO. (1) Supplies to a qualifying person of any services of installing heating appliances in the qualifying person’s sole or main residence. (2) Supplies of heating appliances made to a qualifying person by a person who installs those appliances in the qualifying person’s sole or main residence. (3) Supplies to a qualifying person of services of connecting, or reconnecting, a mains gas supply to the qualifying person’s sole or main residence. (4) Supplies of goods made to a qualifying person by a person connecting, or reconnecting, a mains gas supply to the qualifying person’s sole or main residence, being goods whose installation is necessary for the connection, or reconnection, of the mains gas supply. (5) Supplies to a qualifying person of services of installing, maintaining or repairing a central heating system in the qualifying person’s sole or main residence. (6) Supplies of goods made to a qualifying person by a person installing, maintaining or repairing a central heating system in the qualifying person’s sole or main residence, being goods whose installation is necessary for the installation, maintenance or repair of the central heating system. (7) Supplies consisting in the leasing of goods that form the whole or part of a central heating system installed in the sole or main residence of a qualifying person. (8) Supplies of goods that form the whole or part of a central heating system installed in a qualifying person’s sole or main residence and that, immediately before being supplied, were goods leased under arrangements such that the consideration for the supplies consisting in the leasing of the goods was, in whole or in part, funded by a grant made under a relevant scheme. (9) Supplies to a qualifying person of services of installing qualifying security goods in the qualifying person’s sole or main residence. (10) Supplies of qualifying security goods made to a qualifying person by a person who installs those goods in the qualifying person’s sole or main residence. NOTES: (1) (1) Each of items 1 to 7, 9 and 10 applies to a supply only to the extent that the consideration for the supply is, or is to be, funded by a grant made under a relevant scheme. (2) Item 8 applies to a supply only to the extent that the consideration for the supply— (a) is, or is to be, funded by a grant made under a relevant scheme; or (b) is a payment becoming due only by reason of the termination (whether by the passage of time or otherwise) of the leasing of the goods in question. (2) (1) For the purposes of this Group a scheme is a “relevant scheme” if it is one which satisfies the conditions specified in this paragraph. (2) The first condition is that the scheme has as one of its objectives the funding of the installation of energy-saving materials in the homes of any persons who are qualifying persons. (3) The second condition is that the scheme disburses, whether directly or indirectly, its grants in whole or in part out of funds made available to it in order to achieve that objective— (a) by the Secretary of State, (b) by the Scottish Ministers, (c) by the National Assembly for Wales, (d) by a Minister (within the meaning given by section 7(3) of the Northern Ireland Act 1998 (c. 47)) or a Northern Ireland department, (e) by the European Union , (f) under an arrangement approved by the Gas and Electricity Markets Authority, (g) under an arrangement approved by the Director General of Electricity Supply for Northern Ireland, or (h) by a local authority. (4) The reference in sub-paragraph (3)(f) to an arrangement approved by the Gas and Electricity Markets Authority includes a reference to an arrangement approved by the Director General of Electricity Supply, or the Director General of Gas Supply, before the transfer (under the Utilities Act 2000 (c. 27)) of his functions to the Authority. (3) Where a grant is made under a relevant scheme in order— (a) to fund a supply of a description to which any of items 1 to 10 applies (“the relevant supply”), and (b) also to fund a supply to which none of those items applies (“the non-relevant supply”), the proportion of the grant that is to be attributed, for the purposes of paragraph 1, to the relevant supply shall be the same proportion as the consideration reasonably attributable to that supply bears to the consideration for that supply and for the non-relevant supply. (4) For the purposes of items 1 and 2 “heating appliances” means any of the following— (a) gas-fired room heaters that are fitted with thermostatic controls; (b) electric storage heaters; (c) closed solid fuel fire cassettes; (d) electric dual immersion water heaters with foam-insulated hot water tanks; (e) gas-fired boilers; (f) oil-fired boilers; (g) radiators. (5) For the purposes of items 9 and 10 “qualifying security goods” means any of the following— (a) locks or bolts for windows; (b) locks, bolts or security chains for doors; (c) spy holes; (d) smoke alarms. (6) (1) For the purposes of this Group, a person to whom a supply is made is “a qualifying person” if at the time of the supply he— (a) is aged 60 or over; or (b) is in receipt of one or more of the benefits mentioned in sub-paragraph (2). (2) Those benefits are— (a) council tax benefit under Part 7 of the Contributions and Benefits Act; (b) disability living allowance under Part 3 of the Contributions and Benefits Act or Part 3 of the Northern Ireland Act; (c) disabled person’s tax credit, working families’ tax credit, housing benefit or income support under Part 7 of the Contributions and Benefits Act or Part 7 of the Northern Ireland Act; (d) an income-based jobseeker’s allowance within the meaning of section 1(4) of the Jobseekers Act 1995 (c. 18) or Article 3(4) of the Jobseekers (Northern Ireland) Order 1995 (S.I. 1995/275 (N.I. 15)); (e) disablement pension under Part 5 of the Contributions and Benefits Act, or Part 5 of the Northern Ireland Act, that is payable at the increased rate provided for under section 104 (constant attendance allowance) of the Act concerned; (f) war disablement pension under the Naval, Military and Air Forces Etc. (Disablement and Death) Service Pensions Order 1983 (S.I. 1983/883) that is payable at the increased rate provided for under article 14 (constant attendance allowance) or article 26A (mobility supplement) of that Order. (3) In sub-paragraph (2)— (a) “the Contributions and Benefits Act” means the Social Security Contributions and Benefits Act 1992 (c. 4); and (b) “the Northern Ireland Act” means the Social Security Contributions and Benefits (Northern Ireland) Act 1992 (c. 7). ITEM NO. (1) Supplies of women’s sanitary products. NOTES: (1) (1) In this Group “women’s sanitary products” means women’s sanitary products of any of the following descriptions— (a) subject to sub-paragraph (2), products that are designed, and marketed, as being solely for use for absorbing, or otherwise collecting, lochia or menstrual flow; (b) panty liners, other than panty liners that are designed as being primarily for use as incontinence products; (c) sanitary belts. (2) Sub-paragraph (1)(a) does not include protective briefs or any other form of clothing. ITEM NO. (1) Supplies of children’s car seats. NOTES: (1) (1) For the purposes of this Group, the following are “children’s car seats”— (a) a safety seat; (b) the combination of a safety seat and a related wheeled framework; (c) a booster seat; (d) a booster cushion. (2) In this Group “child” means a person aged under 14 years. (2) In this Group “safety seat” means a seat— (a) designed to be sat in by a child in a road vehicle, (b) designed so that, when in use in a road vehicle, it can be restrained— (i) by a seat belt fitted in the vehicle, or (ii) by belts, or anchorages, that form part of the seat being attached to the vehicle, or (iii) in either of those ways, and (c) incorporating an integral harness, or integral impact shield, for restraining a child seated in it. (3) For the purposes of this Group, a wheeled framework is “related” to a safety seat if the framework and the seat are each designed so that— (a) when the seat is not in use in a road vehicle it can be attached to the framework, and (b) when the seat is so attached, the combination of the seat and the framework can be used as a child’s pushchair. (4) In this Group “booster seat” means a seat designed— (a) to be sat in by a child in a road vehicle, and (b) so that, when in use in a road vehicle, it and a child seated in it can be restrained by a seat belt fitted in the vehicle. (5) In this Group “booster cushion” means a cushion designed— (a) to be sat on by a child in a road vehicle, and (b) so that a child seated on it can be restrained by a seat belt fitted in the vehicle ITEM NO. (1) The supply, in the course of a qualifying conversion, of qualifying services related to the conversion. (2) The supply of building materials if— (a) the materials are supplied by a person who, in the course of a qualifying conversion, is supplying qualifying services related to the conversion, and (b) those services include the incorporation of the materials in the building concerned or its immediate site. NOTES: (1) (1) Sub-paragraph (2) applies where a supply of services is only in part a supply to which item 1 applies. (2) The supply, to the extent that it is one to which item 1 applies, is to be taken to be a supply to which item 1 applies. (3) An apportionment may be made to determine that extent. (2) (1) A “qualifying conversion” means— (a) a changed number of dwellings conversion (see paragraph 3); (b) a house in multiple occupation conversion (see paragraph 5); or (c) a special residential conversion (see paragraph 7). (2) Sub-paragraph (1) is subject to paragraphs 9 and 10. (3) (1) A “changed number of dwellings conversion” is— (a) a conversion of premises consisting of a building where the conditions specified in this paragraph are satisfied, or (b) a conversion of premises consisting of a part of a building where those conditions are satisfied. (2) The first condition is that after the conversion the premises being converted contain a number of single household dwellings that is— (a) different from the number (if any) that the premises contain before the conversion, and (b) greater than, or equal to, one. (3) The second condition is that there is no part of the premises being converted that is a part that after the conversion contains the same number of single household dwellings (whether zero, one or two or more) as before the conversion. (4) (1) For the purposes of this Group “single household dwelling” means a dwelling— (a) that is designed for occupation by a single household, and (b) in relation to which the conditions set out in sub-paragraph (3) are satisfied. (2) For the purposes of this Group “multiple occupancy dwelling” means a dwelling— (a) that is designed for occupation by persons not forming a single household, and (b) in relation to which the conditions set out in sub-paragraph (3) are satisfied. (3) The conditions are— (a) that the dwelling consists of self-contained living accommodation, (b) that there is no provision for direct internal access from the dwelling to any other dwelling or part of a dwelling, (c) that the separate use of the dwelling is not prohibited by the terms of any covenant, statutory planning consent or similar provision, and (d) that the separate disposal of the dwelling is not prohibited by any such terms. (4) For the purposes of this paragraph, a dwelling “is designed” for occupation of a particular kind if it is so designed— (a) as a result of having been originally constructed for occupation of that kind and not having been subsequently adapted for occupation of any other kind, or (b) as a result of adaptation. (5) (1) A “house in multiple occupation conversion” is— (a) a conversion of premises consisting of a building where the condition specified in sub-paragraph (2) below is satisfied, or (b) a conversion of premises consisting of a part of a building where that condition is satisfied. (2) The condition is that— (a) before the conversion the premises being converted contain only a single household dwelling or two or more such dwellings, (b) after the conversion those premises contain only a multiple occupancy dwelling or two or more such dwellings, and (c) the use to which those premises are intended to be put after the conversion is not to any extent use for a relevant residential purpose. (6) For the purposes of this Group “use for a relevant residential purpose” means use as— (a) a home or other institution providing residential accommodation for children, (b) a home or other institution providing residential accommodation with personal care for persons in need of personal care by reason of old age, disablement, past or present dependence on alcohol or drugs or past or present mental disorder, (c) a hospice, (d) residential accommodation for students or school pupils, (e) residential accommodation for members of any of the armed forces, (f) a monastery, nunnery or similar establishment, or (g) an institution which is the sole or main residence of at least 90 per cent. of its residents, except use as a hospital, prison or similar institution or an hotel, inn or similar establishment. (7) (1) A “special residential conversion” is a conversion of premises consisting of— (a) a building or two or more buildings, (b) a part of a building or two or more parts of buildings, or (c) a combination of— (i) a building or two or more buildings, and (ii) a part of a building or two or more parts of buildings, where the conditions specified in this paragraph are satisfied. (2) The first condition is that, before the conversion, the premises being converted contain only— (a) a dwelling or two or more dwellings, or (b) a dwelling, or two or more dwellings, and (i) an ancillary outbuilding occupied together with the dwelling or one or more of the dwellings, or (ii) two or more ancillary outbuildings each occupied together with the dwelling or one or more of the dwellings. (3) In sub-paragraph (2) “dwelling” means single household dwelling or multiple occupancy dwelling. (4) The second condition is that where before the conversion the premises being converted contain a multiple occupancy dwelling or two or more such dwellings, the use to which that dwelling, or any of those dwellings, was last put before the conversion was not to any extent use for a relevant residential purpose. (5) The third condition is that the premises being converted must be intended to be used after the conversion solely for a relevant residential purpose. (6) The fourth condition is that, where the relevant residential purpose is an institutional purpose, the premises being converted must be intended to form after the conversion the entirety of an institution used for that purpose. (7) In sub-paragraph (6) “institutional purpose” means a purpose within paragraph 6(a) to (c), (f) or (g). (8) (1) This paragraph applies where the qualifying conversion concerned is a special residential conversion. (2) Item 1 or 2 does not apply to a supply unless— (a) it is made to a person who intends to use the premises being converted for the relevant residential purpose, and (b) before it is made, the person to whom it is made has given to the person making it a certificate that satisfies the requirements in sub-paragraph (3). (3) Those requirements are that the certificate— (a) is in such form as may be specified in a notice published by the Commissioners, and (b) states that the conversion is a special residential conversion. (4) In sub-paragraph (2)(a) “the relevant residential purpose” means the purpose within paragraph 6 for which the premises being converted are intended to be used after the conversion. (9) (1) A qualifying conversion includes any garage works related to the— (a) changed number of dwellings conversion, (b) house in multiple occupation conversion, or (c) special residential conversion, concerned. (2) In this paragraph “garage works” means— (a) the construction of a garage, or (b) a conversion of a non-residential building, or of a non-residential part of a building, that results in a garage. (3) For the purposes of sub-paragraph (1), garage works are “related” to a conversion if— (a) they are carried out at the same time as the conversion, and (b) the resulting garage is intended to be occupied with— (i) where the conversion concerned is a changed number of dwellings conversion, a single household dwelling that will after the conversion be contained in the building, or part of a building, being converted, (ii) where the conversion concerned is a house in multiple occupation conversion, a multiple occupancy dwelling that will after the conversion be contained in the building, or part of a building, being converted, or (iii) where the conversion concerned is a special residential conversion, the institution or other accommodation resulting from the conversion. (4) In sub-paragraph (2) “non-residential” means neither designed, nor adapted, for use— (a) as a dwelling or two or more dwellings, or (b) for a relevant residential purpose. (10) (1) A conversion is not a qualifying conversion if any statutory planning consent needed for the conversion has not been granted. (2) A conversion is not a qualifying conversion if any statutory building control approval needed for the conversion has not been granted. (11) (1) In the case of a conversion of a building, “supply of qualifying services” means a supply of services that consists in— (a) the carrying out of works to the fabric of the building, or (b) the carrying out of works within the immediate site of the building that are in connection with— (i) the means of providing water, power, heat or access to the building, (ii) the means of providing drainage or security for the building, or (iii) the provision of means of waste disposal for the building. (2) In the case of a conversion of part of a building, “supply of qualifying services” means a supply of services that consists in— (a) the carrying out of works to the fabric of the part, or (b) the carrying out of works to the fabric of the building, or within the immediate site of the building, that are in connection with— (i) the means of providing water, power, heat or access to the part, (ii) the means of providing drainage or security for the part, or (iii) the provision of means of waste disposal for the part. (3) In this paragraph— (a) references to the carrying out of works to the fabric of a building do not include the incorporation, or installation as fittings, in the building of any goods that are not building materials; (b) references to the carrying out of works to the fabric of a part of a building do not include the incorporation, or installation as fittings, in the part of any goods that are not building materials. (12) In this Group “building materials” has the meaning given by Notes (22) and (23) of Group 5 to Schedule 8 (zero-rating of construction and conversion of buildings). ITEM NO. (1) The supply, in the course of the renovation or alteration of a single household dwelling, of qualifying services related to the renovation or alteration. (2) The supply of building materials if— (a) the materials are supplied by a person who, in the course of the renovation or alteration of a single household dwelling, is supplying qualifying services related to the renovation or alteration, and (b) those services include the incorporation of the materials in the dwelling concerned or its immediate site. NOTES: (1) (1) Sub-paragraph (2) applies where a supply of services is only in part a supply to which item 1 applies. (2) The supply, to the extent that it is one to which item 1 applies, is to be taken to be a supply to which item 1 applies. (3) An apportionment may be made to determine that extent. (2) For the purposes of this Group— - “alteration” includes extension; - “single household dwelling” has the meaning given by paragraph 4 of the Notes to Group 6. (3) (1) Item 1 or 2 does not apply to a supply unless either of the empty home conditions is satisfied. (2) The first “empty home condition” is that the dwelling concerned has not been lived in during the period of 3 years ending with the commencement of the relevant works. (3) The second “empty home condition” is that— (a) the dwelling was not lived in during a period of at least 3 years; (b) the person, or one of the persons, whose beginning to live in the dwelling brought that period to an end was a person who (whether alone or jointly with another or others) acquired the dwelling at a time— (i) no later than the end of that period, and (ii) when the dwelling had been not lived in for at least 3 years; (c) no works by way of renovation or alteration were carried out to the dwelling during the period of 3 years ending with the acquisition; (d) the supply is made to a person who is— (i) the person, or one of the persons, whose beginning to live in the property brought to an end the period mentioned in paragraph (a), and (ii) the person, or one of the persons, who acquired the dwelling as mentioned in paragraph (b); and (e) the relevant works are carried out during the period of one year beginning with the day of the acquisition. (4) In this paragraph “the relevant works” means— (a) where the supply is of the description set out in item 1, the works that constitute the services supplied; (b) where the supply is of the description set out in item 2, the works by which the materials concerned are incorporated in the dwelling concerned or its immediate site. (5) In sub-paragraph (3), references to a person acquiring a dwelling are to that person having a major interest in the dwelling granted, or assigned, to him for a consideration. (4) (1) Item 1 or 2 does not apply to a supply unless any statutory planning consent needed for the renovation or alteration has been granted. (2) Item 1 or 2 does not apply to a supply unless any statutory building control approval needed for the renovation or alteration has been granted. (5) (1) “Supply of qualifying services” means a supply of services that consists in— (a) the carrying out of works to the fabric of the dwelling, or (b) the carrying out of works within the immediate site of the dwelling that are in connection with— (i) the means of providing water, power, heat or access to the dwelling, (ii) the means of providing drainage or security for the dwelling, or (iii) the provision of means of waste disposal for the dwelling. (2) In sub-paragraph (1)(a), the reference to the carrying out of works to the fabric of the dwelling does not include the incorporation, or installation as fittings, in the dwelling of any goods that are not building materials. (6) In this Group “building materials” has the meaning given by Notes (22) and (23) of Group 5 to Schedule 8 (zero-rating of construction and conversion of buildings).

.

Part 2 — CONSEQUENTIAL AMENDMENTS

Value Added Tax Act 1994 (c. 23)

2

In section 2 of the Value Added Tax Act 1994 (rate of VAT), in each of subsections (2) and (3) (power to vary rate by up to 25% for up to one year), after “for the time being in force” insert “ under this section ”.

3

In section 62(1)(a)(i) of the Value Added Tax Act 1994 (penalty for giving incorrect certificate as to entitlement to reduced rate etc.), for “paragraph 1 of Schedule A1,” substitute “ any of the Groups of Schedule 7A, ”.

4

• (1) Section 88 of the Value Added Tax Act 1994 (supplies spanning change of rate etc.) is amended as follows.

• (2) In subsection (1) (section applies where there is a change in the rate of VAT in force under section 2 or the descriptions of exempt or zero-rated supplies or acquisitions)—

• (a) after “section 2” insert “ or 29A ”, and

• (b) for “or zero-rated” (in both places) substitute “ , zero-rated or reduced-rate ”.

• (3) In subsection (2) (election to disregard time of supply rules), after “any question whether it is zero-rated or exempt” insert “ or a reduced-rate supply ”.

• (4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5

In section 96(9) of the Value Added Tax Act 1994 (notes in Schedules 8 and 9 to be used for interpretation and capable of being varied), after “Schedules” insert “ 7A, ”.

6

• (1) Section 97(4) of the Value Added Tax Act 1994 (orders that cease to have effect if not approved by the House of Commons within 28 days of being made) is amended as follows.

• (2) In paragraph (c)(i) (orders increasing rate of VAT in force), after “in force” insert “ under section 2 ”.

• (3) In paragraph (c), after sub-paragraph (ii) insert—

(iia) for varying Schedule 7A so as to cause VAT to be charged on a supply at the rate in force under section 2 instead of that in force under section 29A;

.

• (4) In paragraph (d)(i) (exception for orders under section 51 that are consequential on orders that vary Schedule 8 or 9 but do not fall within paragraph (c)), after “Schedule” insert “ 7A, ”.

Finance Act 2000 (c. 17)

7

In paragraph 9 of Schedule 6 to the Finance Act 2000 (climate change levy: meaning of “for domestic use”), after sub-paragraph (4) (power under section 2(1C) of the Value Added Tax Act 1994 (c. 23) to amend Schedule A1 to that Act includes power to make corresponding amendments to paragraph 9) there is inserted—

(5) The power to make provision under section 29A(3) of the Value Added Tax Act 1994 varying Schedule 7A to that Act (charge at reduced rate) includes power to make provision for any appropriate corresponding variation of this paragraph.

.

SCHEDULE 32

Schedule applies where there has been a transfer to which Parts 2 and 3 of Schedule 17 to the Finance Act 1980 do not apply

1

• (1) This Schedule applies where—

• (a) there has been a transfer of the whole or part of the interest in an oil field of a participator in the field (see paragraph 4),

• (b) the transfer is an excluded transfer (see paragraph 2), and

• (c) an allowable loss has accrued from the field to—

• (i) the old participator,

• (ii) the new participator, or

• (iii) a subsequent new owner (see paragraph 3).

• (2) In this Schedule—

• “the loss-maker” means the person to whom the allowable loss accrues;

• “the old participator” means the person whose interest is wholly or partly transferred by the transfer and “the new participator” means the person to whom the interest or part is transferred by the transfer;

• “the transferred interest” means—where the transfer is of the whole of the old participator’s interest in the field, that interest, andwhere the transfer is of part of the old participator’s interest in the field, that part.

Meaning of “excluded transfer”

2

For the purposes of this Schedule, a transfer of the whole or part of the interest in an oil field of a participator in the field is an “excluded transfer” if—

• (a) Parts 2 and 3 of Schedule 17 to the Finance Act 1980 (c. 48) do not apply to the transfer, and

• (b) either—

• (i) the transfer is made pursuant to an agreement made on or after 7th March 2001, or

• (ii) the transfer is made pursuant to a conditional agreement made before 7th March 2001 and the condition is satisfied on or after 7th March 2001.

Meaning of “subsequent new owner”

3

For the purposes of this Schedule, a “subsequent new owner” is any participator in the field who has the transferred interest, or any part of the transferred interest, as a result of—

• (a) a transfer by the new participator of the whole or part of the transferred interest, or

• (b) the combination of such a transfer as is mentioned in paragraph (a) and—

• (i) a transfer by a subsequent new owner of the whole or part of the transferred interest, or

• (ii) two or more such transfers as are mentioned in sub-paragraph (i).

Transfers of interests in oil fields: interpretation

4

• (1) For the purposes of this Schedule, a participator in an oil field transfers the whole or part of his interest in the field whenever as a result of a transaction or event other than—

• (a) the making of an agreement or arrangement of the kind mentioned in paragraph 5 of Schedule 3 to the Oil Taxation Act 1975 (c. 22) (agreement or arrangement for transfer of participator’s rights to associated company), or

• (b) a re-determination under a unitisation agreement,

the whole or part of his share in the oil to be won and saved from the field becomes the share or part of the share of another person who is or becomes a participator in the field.

• (2) Paragraph 1(2) of Schedule 17 to the Finance Act 1980 (c. 48) (meaning of “unitisation agreement” and “re-determination”) applies for the purposes of sub-paragraph (1) above as for those of paragraph 1(1) of that Schedule.

Schedule applies in place of section 6(1C) of the Oil Taxation Act 1975

5

Where this Schedule makes provision for determining the unrelievable portion of an allowable loss, that portion is determined in accordance with the provisions of this Schedule instead of in accordance with the provisions of section 6(1C) of the Oil Taxation Act 1975.

General rule for determinations under this Schedule of “unrelievable portion” of loss

6

• (1) The unrelievable portion of the allowable loss is so much of the intermediate unrelieved loss as cannot be relieved under paragraph 7 against relevant profits.

• (2) In this Schedule—

• “the intermediate unrelieved loss” is so much of the allowable loss as cannot be relieved under section 7 of the Oil Taxation Act 1975 against assessable profits accruing from the field to the loss-maker;

• “relevant profits” means assessable profits—accruing from the field to any participator in the field other than the loss-maker,computed as if the amounts mentioned in section 2(8)(a) of that Act did not include expenditure unrelated to the field except where it has been allowed in pursuance of a claim or election for its allowance received by the Board before 29th November 1994, andreduced (after being so computed) under section 7 of that Act.

• (3) In sub-paragraph (2) “expenditure unrelated to the field” has the meaning given by section 6(9) of that Act.

Loss to be relieved against other participators' profits

7

• (1) The intermediate unrelieved loss shall (but only for the purposes of determinations under this Schedule) be relieved against relevant profits accruing to a different owner.

• (2) The provisions of paragraphs 8 to 10 apply for the purposes of relieving the intermediate unrelieved loss under this paragraph.

• (3) In this paragraph and paragraph 8, a “different owner” means any participator in the field who—

• (a) has the loss-maker’s interest at any time (whether before or after the transfer) when the loss-maker does not have that interest, or

• (b) has a part of the loss-maker’s interest at any time (whether before or after the transfer) when the loss-maker does not have that part.

• (4) In sub-paragraph (3) “the loss-maker’s interest” means—

• (a) if the loss-maker is the old participator or the new participator, the transferred interest;

• (b) if the loss-maker is a subsequent new owner and at any time (whether before or after the transfer) has the whole of the transferred interest, that interest; and

• (c) if the loss-maker is a subsequent new owner and paragraph (b) does not apply, the aggregate of each part of the transferred interest that at any time (whether before or after the transfer) is a part that the loss-maker has.

Extent to which losses to be relieved

8

• (1) Where the interest in the field of a different owner is the transferred interest, the intermediate unrelieved loss is to be relieved against the whole of any relevant profits accruing to the different owner.

• (2) Where the interest in the field of a different owner is part of the transferred interest, the corresponding part (but only that part) of the intermediate unrelieved loss is to be relieved against the whole of any relevant profits accruing to the different owner.

• (3) Where—

• (a) a different owner’s interest in the field includes the transferred interest, but

• (b) the transferred interest is only part of the different owner’s interest in the field,

the intermediate unrelieved loss is to be relieved against the corresponding part (but no other part) of any relevant profits accruing to the different owner.

• (4) Sub-paragraph (5) applies where—

• (a) a different owner’s interest in the field includes part only of the transferred interest (“the owned part of the transferred interest”), and

• (b) the owned part of the transferred interest is only part of the different owner’s interest in the field.

• (5) Only the part of the intermediate unrelieved loss corresponding to the owned part of the transferred interest is to be relieved, and it is to be relieved against (but only against) the part of any relevant profits accruing to the different owner that corresponds to the part which the owned part of the transferred interest forms of the different owner’s interest in the field.

Profits not to be utilised more than once

9

The intermediate unrelieved loss may not be relieved against relevant profits to the extent that those profits have already been utilised for the purposes of paragraph 7.

Relieving different losses against the same profits

10

• (1) Where intermediate unrelieved losses accruing to each of two or more persons fall to be relieved under paragraph 7 against the same relevant profits, such a loss accruing to a person who last had the transferred interest (or part of it) at an earlier time shall be so relieved before one accruing to a person who last had the interest (or part) at a later time.

• (2) Where—

• (a) two or more persons each last had a part of the transferred interest at the same time, and

• (b) intermediate unrelieved losses accruing to each of them fall to be relieved under paragraph 7 against the same relevant profits,

those losses shall be so relieved in such a manner as ensures that the same proportion of each is so relieved.

• (3) In this paragraph, references to an intermediate unrelieved loss accruing to a person are to the intermediate unrelieved loss in respect of an allowable loss accruing to the person.

Construction as one with Part 1 of the Oil Taxation Act 1975

11

This Schedule shall be construed as one with Part 1 of the Oil Taxation Act 1975 (c. 22).

SCHEDULE 33

Part 1 — EXCISE DUTIES

Part 2 — INCOME TAX, CORPORATION TAX AND CAPITAL GAINS TAX

Part 3 — OTHER TAXES

Rates of duty on hydrocarbon oil

Rebate on unleaded petrol

Fuel-testing pilot projects

Dilution etc. of cider

Rates of duty for vehicles used for exceptional loads

Rates of duty for recovery vehicles

Exemption of agricultural etc. vehicles

Payments by Commissioners in case of error or delay

Charge to aggregates levy

30A

• (1) The Commissioners may by regulations make provision of the kind described in section 30(2) above (entitlement to tax credit) in relation to cases within subsection (2) below.

• (2) The cases are those where a charge to aggregates levy has arisen on a quantity of aggregate which has been subjected to commercial exploitation during a prescribed period.

• (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (4) The amount of a tax credit to which a person is entitled under the regulations must not be more than 80% of any aggregates levy charged on the aggregate in question.

• (5) Regulations under this section may in particular make provision—

• (a) for a person to be entitled to a tax credit under the regulations in respect of aggregate originating from a site in respect of which any person holds an aggregates levy credit certificate which has not been withdrawn;

• (b) for an aggregates levy credit certificate to be issued to a person in respect of a site only if an aggregates levy credit agreement is in force in respect of the site;

• (c) for the withdrawal of an aggregates levy credit certificate where the aggregates levy credit agreement in respect of which it was issued is no longer in force;

• (d) for the form and content of aggregates levy credit certificates and aggregates levy credit agreements.

• (6) Regulations under this section which make provision such as is mentioned in subsection (5)(d) above may be framed by reference to any provisions of a notice published by the Commissioners in pursuance of the regulations and not withdrawn by a further notice.

• (7) If regulations under this section make provision such as is mentioned in subsection (5) above, the Commissioners or the Northern Ireland Department may—

• (a) enter into aggregates levy credit agreements;

• (b) issue and withdraw aggregates levy credit certificates;

• (c) take such other steps as the Commissioners or the Northern Ireland Department consider appropriate in relation to aggregates levy credit agreements and aggregates levy credit certificates.

• (8) Regulations under this section which make provision such as is mentioned in subsection (5) above must include provision requiring the Northern Ireland Department to inform the Commissioners if the Northern Ireland Department issues or withdraws an aggregates levy credit certificate.

• (9) Subsections (3) to (5) of section 30 above apply to regulations under this section as they apply to regulations under that section.

• (10) The Treasury may by order made by statutory instrument amend subsection (4) above by substituting for the percentage for the time being specified in that subsection a percentage lower than 80%.

• (11) An order under subsection (10) above shall not be made unless a draft of the order has been laid before Parliament and approved by a resolution of the House of Commons.

• (12) Any expenses of the Northern Ireland Department under this section shall be charged on the Consolidated Fund of Northern Ireland.

• (13) In this section—

• “aggregates levy credit agreement” means an agreement entered into in respect of a site by the person operating the site and the Commissioners or the Northern Ireland Department;

• “aggregates levy credit certificate” means a certificate issued to the person operating a site by the Commissioners or the Northern Ireland Department as evidence of the fact that an aggregates levy credit agreement has been entered into in respect of the site;

• “the Northern Ireland Department” means the Department of the Environment in Northern Ireland.

Extensions of time

Review out of time

Mileage allowances: exemptions and relief

Appeals: further provisions

Adjustments of contracts

Adjustments of contracts

Employee share ownership plans

Payments to employers out of pension funds

Limited liability partnerships: investment LLPs and property investment LLPs

Double taxation relief

Taper relief: assets qualifying as business assets

Exemptions in relation to approved share incentive plans

SDRT: open-ended investment companies and individual pension accounts

VAT representatives

PRT: unrelievable field losses

PRT: allowable decommissioning expenditure

PRT: allowable decommissioning expenditure

Climate change levy

92A

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

92B

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Climate change levy

Repeals and revocations

Repeals and revocations

PRT: allowable decommissioning expenditure

Error relating to rebate

Interest on unpaid tax, etc.: foot-and-mouth disease

Disclosure of information

Finance Act 2000 (c. 17)

Value received by investor

For sections 1 to 5 of the Betting and Gaming Duties Act 1981 (c. 63) (general betting duty: charge, rate and payment) substitute—

Certain receipts to be disregarded

Trustees: anti-avoidance

Interpretation

Penalties in connection with returns etc.

9A

• (1) This paragraph applies where—

• (a) a claim is made for a tax credit in such a case as is mentioned in—

• (i) section 30(1)(c) of this Act (aggregate used in a prescribed industrial or agricultural process), ...

• (ii) section 30A of this Act (transitional tax credit in Northern Ireland), or

• (iii) section 30B(3) of this Act (special tax credit in Northern Ireland);

• (b) a record or other document is provided to the Commissioners as evidence for the claim; and

• (c) the record or document is incorrect.

• (2) The person who provided the document to the Commissioners, and any person who provided it to anyone else with a view to its being used as evidence for a claim for a tax credit, shall be liable to a penalty.

• (3) The amount of the penalty shall be equal to 105 per cent of the difference between—

• (a) the amount of tax credit that would have been due on the claim if the record or document had been correct, and

• (b) the amount (if any) of tax credit actually due on the claim.

• (4) The providing of a record or other document shall not give rise to a penalty under this paragraph if the person who provided it satisfies the Commissioners or, on appeal, an appeal tribunal that there is a reasonable excuse for his having provided it.

• (5) Where by reason of providing a record or other document—

• (a) a person is convicted of an offence (whether under this Act or otherwise), . . .

• (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

that person shall not by reason of the providing of the record or document be liable also to a penalty under this paragraph.

Receipt of replacement value

After Schedule 12 to the Taxes Act 1988 insert—

Interpretation

Designated period

Value received by investor

Ring fence trades: special allowance for pre-cessation abandonment expenditure

Ring fence trades: allowances for post-cessation expenditure

Value received by persons other than the investor

Ring fence trades: allowances for post-cessation expenditure

Ring fence trades: meaning of “abandonment expenditure”

Writing-down allowances: infrastructure from UK or non-UK oil fields

Writing-down allowances: infrastructure from UK or non-UK oil fields

Loss relief

Ring fence trades: special allowance for pre-cessation expenditure

Loss relief

Repayment supplements

Ring fence trades: allowances for post-cessation expenditure

Insignificant repayments disregarded

Writing-down allowances: infrastructure from UK or non-UK oil fields

Fixtures: purchasers of land and incoming lessees

Ring fence trades: allowances for post-cessation expenditure

Interpretation

Recovery of excessive tax credit

Power to amend or correct personal or trustee return

Procedure on completion of enquiry into personal or trustee return

Procedure on completion of enquiry into personal or trustee return

Due date for payment after amendment or correction of return

Enquiry into company tax return

Interpretation

Other amendments of the Taxes Management Act 1970

Effect of return on recovery proceedings

Effect of return on recovery proceedings

Other amendments of the Taxes Management Act 1970

Ring fence trades: allowances for post-cessation expenditure

Fixtures: purchasers of land and incoming lessees

After Part 4 of the Capital Allowances Act 2001 (c. 2) insert—

Procedure on completion of enquiry into personal or trustee return

Ring fence trades: allowances for post-cessation expenditure

Other amendments of the Taxes Management Act 1970

Restriction of relief for underlying tax

Schedule applies where there has been a transfer to which Parts 2 and 3 of Schedule 17 to the Finance Act 1980 do not apply

Ring fence trades: allowances for post-cessation expenditure

Information: duty of insurers

Assessment by Revenue treated as included in return

Finance Act 2000 (c.17)

Schedule applies where there has been a transfer to which Parts 2 and 3 of Schedule 17 to the Finance Act 1980 do not apply

Enquiry into personal, trustee or partnership return

Enquiry into company tax return

Computation of profits of insurance companies

Other amendments of the Taxes Management Act 1970

Value Added Tax Act 1994 (c.23)

Meaning of “investment LLP” and “property investment LLP”

Due date for payment after amendment or correction of return

Effect of return on recovery proceedings

Effect of return on recovery proceedings

Introductory

Other amendments of the Taxes Management Act 1970

Restriction of relief for underlying tax

Other amendments of the Taxes Management Act 1970

Dividends that give rise to eligible unrelieved foreign tax

Underlying tax excluded from claim not to be allowed under section 811

Life policies: computation of gain

Life annuity contracts: chargeable events

Life annuity contracts: computation of gain

Capital redemption policies: chargeable events

The value of a part or share assigned

Consequential amendments of other enactments

Method of charging gain to tax: multiple interests

Relief where gain charged at higher rate

Right of company to recover tax from trustees

Consequential amendments of other enactments

Information: duty of insurers

Stamp duty reduced for land partly in a disadvantaged area

Apportionment of consideration for stamp duty purposes

Stamp duty reduced for land partly in a disadvantaged area

Enquiry into company tax return

Due date for payment after amendment or correction of return

Effect of return on recovery proceedings

Other amendments of the Taxes Management Act 1970

Consequential amendments of other enactments

Stamp duty reduced for land partly in a disadvantaged area

Value Added Tax Act 1994 (c.23)

Finance Act 2000 (c.17)

These repeals shall be deemed to have come into force in accordance with section 2(5) of this Act.

1

The repeals of—

• (a) section 19(3) of the Vehicle Excise and Registration Act 1994, and

• (b) paragraph 8 of Schedule 2 to the Finance Act 1996,

come into force on the passing of this Act.

2

The other repeals have effect in relation to licences issued on or after 1st April 2001 and shall be deemed to have come into force on 1st April 2001.

1

The repeal of section 289A(9) of the Taxes Act 1988 has effect in accordance with paragraph 9(2) of Schedule 15 to this Act.

2

The repeals in the following provisions have effect in accordance with paragraph 40(3) of Schedule 15 to this Act—

3

The repeals in section 576 of the Taxes Act 1988 have effect in accordance with paragraph 38(5) of Schedule 15 to this Act.

4

The repeal in Schedule 15B to the Taxes Act 1988 has effect in accordance with paragraph 3(2) of Schedule 16 to this Act.

5

The repeal in paragraph 21 of Schedule 15 to the Finance Act 1994 has effect in accordance with paragraph 22(2) of Schedule 15 to this Act.

6

The remaining repeals have effect in accordance with paragraph 40(2) of Schedule 15 to this Act.

1

The repeal in section 164 of the Capital Allowances Act 2001 has effect in accordance with paragraph 9(1), (5) and (8) of Schedule 20 to this Act.

2

The repeal in section 165 of that Act shall be deemed always to have had effect.

1

The repeals in the Taxes Management Act 1970 have effect in relation to proceedings begun after the passing of this Act.

2

The other repeals have effect in relation to—

• (a) proceedings begun (or a counterclaim made) after the passing of this Act, and

• (b) a set-off first claimed after the passing of this Act.

1

The repeals of—

• (a) sections 2(1C) and 97(4)(aa) of the Value Added Tax Act 1994, and

• (b) paragraph 9(4) of Schedule 6 to the Finance Act 2000,

come into force on 1st November 2001.

2

The other repeals and revocations have effect in accordance with section 99(7) of this Act.

1

The repeals in the Finance Act 1991 have effect in accordance with section 103(2) of this Act.

2

The repeals in the Finance Act 1995 have effect in accordance with section 101(5) of this Act.

Editorial notes